ARCADIS intents to cutback real estate valuation activities

The consulting and engineering firm ARCADIS intents to cutback a part of its unremunerative activities in the Netherlands. Examples of possible disinvestments are the real estate valuation activities and the &acute;detailed engineering&acute; -activities. This is what Harry Noy, Chairman of the board of ARCADIS announced last Tuesday at the explanation of the 1Q04 results.

Over the first quarter of 2004 ARCADIS has obtained a net operational profit for goodwill of € 4.5 mln, against € 3.9 mln over the first three months of 2003. According to Noy, the real estate valuation activities have scarcely attributed to the result over the last years, which is partly caused by the discussion whether or not the immovable property tax (OZB) would be abolished.

In the first quarter the operating income of the entire segment Communications, part of which are the immovable property-activities, declined with 10%. According to ARCADIS, this was due to ‘a volume decline in the Dutch real estate appreciation market’. ARCADIS intends to focus on segments with higher margins, such as project management, consultancy and facility management.

By means of acquisitions Noy wants to move up in the value chain. In connection to this intent, ARCADIS took over the Dutch PRC Bouwcentrum last year, which is active in project management and consultancy. Still, for this year Noy expects to realize no take-overs in the Dutch building market. ‘This year we will focus on the integration with PRC Bouwcentrum.’